Having spent much of the last year focused on startup work, analysis, and angel investing, I wanted to briefly outline a focal point of the efficiency technology segment that I gravitate toward. In particular, the most interesting opportunities revolve around existing activities that contain friction and inefficiency, and where the markets and providers seem comfortably numb — and where entrepreneurs with a blend of critical and strategic thinking have seen beyond existing models and methods.

By evaluating issues facing each of an engagement’s constituencies, and re-thinking the engagement mechanisms of the activities involved, revisions for reducing or eliminating friction can be made to the processes so as to also elicit valuable inputs from participants, unlock additional value — even for bystanders, and/or open doors for new constituents. Entrepreneurs and companies who are doing this with a vision for what lies beyond initial disruption are the ones that really pique my interest.

A great example lies in one of my earliest individual angel investments (outside of the Soundboard Angel Fund that I am involved with — which also subsequently invested). The company is Social Bicycles (a.k.a. SoBi), led by Ryan Rzepecki. Their focus at this point is in the bikeshare space, which is generally outlined pretty well in this article. Some of the key issues around bikeshares (beyond those for the operator, such as reliability/repair/maintenance, loss of bikes, and fleet management and flexibility) tend to involve: ability for users to locate bike availability where they want it, and importantly, knowledge that there is space at their destination station to receive their bike. This is due in large part to bikeshares generally being “station” based.

Citi Bike Share (Photo credit: ccho)

Such station-based systems have their “smarts” in the kiosk and rack assemblies that hold the bikes. Once you take a bike from such a system, you’re on your own until you bring it back into the system by parking it in another of the system’s smart racks. Obviously, the destination rack won’t always be at the exact location you’d like to go to, and when you arrive at the one closest to your destination, it may well be full — meaning you have to find another of the system’s racks in order to park/return it. Chances are, particularly if you’re using the bike for commuting purposes, you don’t have a lot of time to hunt for a parking space, nor do you have the flexibility to show up late because you were doing so.

In contrast, (and not to oversimplify all that Ryan and Social Bicycles have done), SoBi has shifted the smarts and locks, from residing within the rack system to the bikes themselves, integrating GPS into the bikes, and using the cloud for procurement — and in so doing, they’ve evolved bikesharing to an un-tethered state.

Bike stands, Toronto, Can (Wikipedia)

This means you can pull out your smartphone and find the bike closest to you, reserve it before you get there, unlock it on arrival, and take it wherever you want to go, without worrying that there might not be a space at your destination because, while they prefer you lock it to a designated regular old bike rack, in a pinch you can lock it to a tree or parking meter (local rules allowing).

With reduced infrastructure requirements, other added benefits of this revised approach include significantly lowering the cost of entry, not to mention lowering the hurdle for any necessary approvals. The cost per bike is about a fifth that of a station-based scenario, and can be eased into and adjusted relatively flexibly in response to what is learned in regards to demand and patterns through operation.

There are many other details to this particular system, and there are many other realms to which this approach of constituency analysis is unlocking real value. In future posts, I plan to share more about some of the other companies I have found to be doing this good work.

(SoundBoard Angel Fund is a democratic fund, with members active in selection and analysis of companies and in ongoing relationships with its portfolio, which is primarly focused in education, consumer products and services, and efficiency technologies).

Our latest Semantic-Link discussion was interesting in that it touched on some distinct but deep topics that tend to recur in our discussions, namely: usability, privacy and the old standby – the definition of semantics itself.

I won’t spend any more time on the definition of semantics beyond that the consensus (for purposes of this discussion) was that it means “meaning”, with contexts including: linguistic/NLP related word-meaning semantics; and the other being compliance with W3C standards – or architectural Semantics. In essence, the latter is what enables a machine version of the former.

The focus was actually a conversation with guest Nova Spivack, and his more current efforts, including Bottlenose and StreamGlider. (Next time we’ll have to let Nova do more of the talking, as we only really had time to dig into the first of those.) Bottlenose is intended to help people manage and interconnect their interaction across the multiple electronic realms in which they operate. While Nova mentions that the system doesn’t currently make use of W3C standard architectural Semantics, it does use ontologies to relate topics and navigate meaning. This is particularly visible in Bottlenose’s Sonar – which renders a visualization of the active topics, hash-tags, and people around you, with adjustable time-horizon. If you’d like to try it out during the private beta, visit Bottlenose.com and you can Sign Up using the Invite Code: semanticlink.

As mentioned above, two key items arose from the discussion – the matters of privacy, and the question of transparency. In the case of privacy, would it become an issue, from a business intelligence standpoint, that others could more easily see the topics that someone is discussing or investigating – especially if such a tool could cross multiple networks/platforms in finding patterns.

As is often the case in these Semantic-Link discussions, the question of “how much should be exposed about the use of semantics” arose. There is of course a balance between active vs viral evangelizing of semantics, and the cost of exposure is simplicity and usability, while the benefit is flexibility and control, for those who can handle it.

The answer itself is complicated. On the one hand, technologies need to evolve in terms of leveraging semantics in order for people to really benefit from the underlying semantic capabilities. At the same time, those same people we’re talking about getting the benefit shouldn’t have to understand the semantics that enable the experience. Paul Miller, host of the podcast, also wrote about this issue. I’ll add that Investors do to like to hear that their company is using unique and valuable techniques. So too, though, is it the case that any company making use of semantics likely feels it is a competitive advantage to them – a disincentive to sharing details of the secret sauce. .

As mentioned during the podcast, this is a matter of which audience is being addressed – the developers or the masses. And in terms of the masses, even that audience is split (as is the case with almost all other software users). There are the casual users, and there are those who are hardcore – and when we’re talking about masses, there are many many more people would fall into the casual camp. So from a design standpoint, this is where usability really matters, and that means simplicity.

So in the case of Bottlenose, for the time being they’ve chosen to hide the details of the semantics, and simplify the user experience – which will hopefully facilitate broader adoption. There may too be room for a power-user mode, to exposes the inner workings of the black-box algorithms that find and weigh associations between people, places, things… and let users tweak those settings beyond the time-frame and focus adjustments that are currently provided.

Mentioned by Nova was the LockerProject in which personal data could potentially be maintained outside any one particular network or platform. This of course helps on the privacy side, but adds a layer of complexity (until someone else comes along and facilitates easy integration – which will no doubt chip some of the privacy value).

Personally, I’d love to see the ability to combine slices of personal activity from one or multiple platforms, with tools such as Bottlenose, so that I could analyze activity around slivers or Circles (in the case of Google+ usage) from various networks, in any analytical platform I choose.

Every now and again, I’m asked why one post or another of mine seems to be off on a tangent from “the usual”. In these cases, it seems that while I’ve stayed true to the theme of connecting ideas to create value, the exchange for that value isn’t as obvious or direct. To me, these are the times that are most interesting – involving translation of the currency, whether to or from knowledge, experience, or goods. It is that value translation that is at the heart of the Second Integral.

I’ll speculate now that this will likley prove to be one of those times.

While walking through Maplewood, NJ last weekend, I came upon a new store in place of one that had recently closed. I ventured in to see what it was about, and discovered it to be an art/craft boutique, with lots of hand crafted and nicely made/decorated items. A woman approached me and asked if I needed any help, and I asked if these were all things made by people locally. She was Cate Lazen, and she turns out to have been the founder of Arts Unbound, the organization that opened this “pop-up” store. She answered my question, saying “well, yes, and everything in the store was made by people dealing with a disability of one sort or another.”

With a part of my brain dedicated full time to triangulation, I found myself automatically thinking about the coalescence of purposes here. On the one hand, people with disabilities, engaging in artistic work as physical therapy, an expressive outlet, to perhaps generate income, while gaining pride, satisfaction, experience… all through their creative art.

Art as therapy itself is clearly valuable – but what struck me as particularly interesting was its combination of it here with (at least) two other constituencies. According to Cate, the shop also employs people with disabilities, so it satisfies many of these same therepeutic purposes for the workers as it does the artists. And of course, being a shop, it brings customers into the mix.

The simple combination of manufacturer + shopkeeper + consumer may not, on the surface, seem so interesting – it is just how a business works. But the dynamic in this case yields some additional benefits beyond the traditional.

Along with the direct purposes noted above, for the artists and workers, and obviously filling customers’ needs, there are some more subtle byproducts as well, and they’re accentuated by the season’s spirit, due to the timing of the shop’s materialization just in time for the holidays.

Those who find their way to the shop will undoubtedly gain awareness of the overall purposes being served by the organization. Additionally, buying a gift from this store provides the giver the satisfaction of giving twice (at least) – to the recipient of the gift, to the artist, to the shop worker, and even the good feeling of having contributed in some small way. All this can even make you feel a little better about buying something for yourself.

Early in my career, when working as a data jockey with an economic consulting firm, I was on a team for a particular project where, I’ll always remember, we were referred to (in the New York Times) as “nitpicking zealots”. While I knew it was meant as a criticism, I took the reference then (as now, for that matter), as a complement – emphasizing the attention-to-detail in our analysis.

For me, that focus has long been coupled with heavy emphasis on usefulness (ok, and logic) as a driving factor in doing or creating anything. “Stick-in-mud” – maybe. “Drive you nuts” – sure, the family says this sometimes… But things just need to make sense.

So it shouldn’t surprise me (or anyone else) that, in my recent Experience Design mini-masters project, I had an overriding need for the product idea my team was to come up with, to be of real use and value. The first task was to evaluate whether design principles had been followed in the creation of a particular product (the Roadmaster – a single-line scrolling text display for use on a car). Then we were to apply these design principles to come up with a different product/application making use of the technology for the context. We performed our review by considering the Roadmaster’s affordances (what the design suggested about its use); its mapping of controls to meaning or functionality; whether it provided feedback during use; its conceptual model and obviousness of purpose; any forcing functions, limters or defaults. Having developed a “sense” of the product, as it was, we were embarked on the design effort by adding interviews/surveys to gather research on potential market need/desire.

Without getting into our conclusions about the Roadmaster product itself, of particular interest is where we ended up going with our design as a result of performing our own contextual inquiry. Some great ideas emerged among the different teams, for which each team prototyped their design (using Axure), performed usability testing, and presented results. Most of the teams designed mainly for social-media driven applications. With our own goals including not just usability, but the usefulness factor mentioned above, we discovered potential in re-purposing the device – to be directed not to other drivers, but to the driver of the vehicle in which it is installed. Specifically, to aid hearing impaired drivers – whether for receiving guidance from a driving instructor, instructions from a gps, or conversing with a passenger.

The design, which at one point we dubbed the “iDrive” (for reasons that will reveal themselves), involves mounting of the scrolling text display out in front of and facing the driver, and integration of speach-to-text conversion, so that as words were spoken, the driver would see these words displayed out in front of them, without their having to turn to see the hands or lips of a person commnicating with them, nor would they have to look away from the road to read directions on a gps screen. In its simplest form, the design calls for an iPhone (or similar) application to perform the voice-to-text conversion, transmitting the resulting text to the display for the driver. An extension of this concept could incorporate detection and display of other sounds, such as a honk, and which direction it is coming from. Since the program, we’ve found that the required voice-to-text conversion capability, in a mobile app (e.g. for the iPhone) as we called for in the design, does exist, so with the combination of the technologies (display, conversion, mobile application, and gps capability), the serving the hearing-impaired-driver market in this way should be within reach.

A side-note to this post: The faculty of the UXD program, Dr. Marilyn Tremaine, Ronnie Battista, and Dr. Alan Milewski, helped to revealed for me that the formal processes of experience design, and particularly contextual inquiry, parallel closely with what I’ve sought to achieve through the joining of the disciplines of Usability, Value Network Analysis (perspectival), and a dash of Semantic (extensible and interoperable) thinking.

The potential impact on the economy from removing burdens around health care should not be underestimated as a means of stimulus. For many, fixing the system could mean enormous savings, if not just improved quality of life and perhaps care.

The solution to our health care situation goes beyond regulation; it lies in changing the focus. The intention should be about “well-being”, and all measurement and compensation for parties to system of “well being” should be driven by the success of the program. The parties include not just the doctors, but all those engaged in the health care processes: the medical insurance companies, malpractice insurers, the pharma and device companies, and extending all the way to those providing therapy and fitness services.

Differing time horizons need to be aligned. Insurers may currently find it beneficial to make decisions based on short-term exposure, regardless of potential longer-term costs that could result from those decisions. After all, it isn’t likely the patient will still be with the same insurer when the longer-term result is encountered. The relationship (or at least the impact of it) needs to be made permanent.

Medical and life insurance should be integrated so that the insurers’ interest in sustaining you is aligned with their interest in maintaining you. The medical portion of premiums should be driven in part by your relative wellness (not just relative to where you should be, but to where you’ve been) and in part by the risks you take and the choices you make about your wellness. Participation in activities that are shown to improve health and reduce risks should be rewarded, while costs should be attached to lack of participation and to risky activity.

Doctors who participate in this wellness driven system would benefit from streamlined administrative processes, not having to process and re-process while fighting for payment. For their participation, they will also have access to more reasonable malpractice coverage. Beyond the direct impact on the medical process, these changes alone should make it attractive again to pursue careers in medicine.

Compensation under this plan would be based, in part, on relative wellness achieved – the wellness performance of those under their care. This is in contrast to payment based on Relative Value Units, which is similar to the way your auto mechanic gets paid. Objectives of insurers too need to be redefined to be driven by wellness in this way too – particularly at the outset of the plan. Over time, as the balance of costs shift as a result of preventive care generating longer term savings, artificial incentives should become less economically important for proper motivation. Treatments will be driven toward solving problems rather than addressing symptoms, and away from allowing perpetual treatment and profit from such.

There are many aspects beyond these to be considered, but only through review of the full spectrum of the roles in this dynamic, with consideration as to how to achieve some of the objectives for each – and with agreement as to what problem(s) we’re trying to solve, can interests be aligned – not just on a particular purpose, but with a long view.

I’m not generally one to comment on political matters (ok, I never do, other than this this month, for some reason) at least not for political purposes. The linkage here to my typical areas of discussion should soon be readily aparrent. Feel free to comment or email me if not, and I’d be glad to elaborate.

We are at an amazing point in history – and not just because Barack Obama is about to become the first African American president. He is, thanks to his charisma, drive, eloquence, perspective… representative of the transition point we’ve reached. This period of change has been brewing since 2000, and was set in motion in earnest in 2004. His success in getting to this point has been both a catalyst for, and the result of, Americans being ready for what Obama has called “The Change We Need”.

This change is about transcendence, repair, and to borrow from the technical lexicon – interoperability – domestically and internationally, philosophically, infrastructurally. Not to imply that there aren’t still dark days ahead, but we’ve already seen movement across party and racial lines, and participation, if not enthusiasm among the previously non-voting or heretofore politically and/or socially indifferent (- the numb or perhaps even the resigned or capitulated).

In these economic times, and while the world’s perception of the U.S. is at a low, we could ask for nothing greater than the combination of an energized and informed nation with an administration tuned to leveraging and guiding this enthusiasm – to rebuild. Interoperability – between the government and the people, between departments, programs, institutions – connecting the moving parts necessary – is the technology of this new era, to make this change work.

Image via WikipediaLast week, I read a story about an idea being considered in Oregon — to move from a gas tax to a mileage tax, to offset losses in road repair revenue as a result of there being more cars with better fuel economy. As Oregon Rep. Peter DeFazio, a member of the House Transportation and Infrastructure Committee, put it: As cars burn less fuel, “the gas tax isn’t going to fill the bill“.

Many may think this seems like an interesting idea, and that even if I did live in Oregon, it wouldn’t impact me very much. Those of you who are of the value network persuasion will likely recognize, right away, the counterproductivity this move would represent. For me, this idea makes little “cents” (pun intended).

Here we are pushing “green”, and acting as if we recognize the impact we’ve had on our environment. And along comes a complicated and expensive approach that seems to perpetuate what I call “long-term short-sightedness”.

Sure, such a tax could serve to counter the revenues being lost as a result of cars having better fuel economy – but at the cost of creating a disincentive to progress and participation we’ve made on the environmental front?

Perhaps not the best alternative, but simply increasing the overall fuel tax, rather than a system that offsets an incentive to “do your part” (at least the part of increased economy), seems a better way to attack the problem – assuming that the problem is simply the reduced revenue.

Another alternative, related to suggestions that the real tartet here is congestion, or at least congestion at certain times of the day, would be to implement tolls – or an EZPass type system for an automated approach. This would “tax” the road use at issue and could be a more efficient approach from an infrastructure standpoint – and one that doesn’t deter what some people are doing to reduce costs/emissions.

Sure, I’m an outsider in this particular case (by about 2,750 miles), and yes, I’ve likely oversimplified the situation, but in addressing new problems, doesn’t it make the most sense to consider all the moving parts and various objectives that we’re trying to satisfy with our actions?

Image via WikipediaWacky looking title. Not perfect – but the point is to do a little analysis of Value Network Analysis. There’s a good Aleksola post [note 9/15/10: that link seems to have died, but here’s another for it] up, relating to the topic – which VN Group(ie) John Maloney shared with the list today.

The post explains VNA as social and technical resources being used together (in relation to one another) to create value – whether intellectual, physical, or otherwise. It distinguishes between in- and out-facing networks, but emphasizes that “Value is created through exchange and the relationships between roles”, over systems in place to enable those interactions.

While it may seem that VNA is about mapping the pathways of social or organizational interaction, such mapping only provides a framework for analysis and discovery – revealing pathways for value.

The actual value created is through the meeting of needs of various parties to transactions or engagement situations. In this way, I think of VNA is a way to consider how the system dynamics of engagement between parties facilitates a kind of currency translation and barter – enabling each to bring to the table something that may (perhaps in combination with something brought by someone else) satisfy the needs of another – and similarly may have their own needs indirectly met.

Before posting thoughts about my panel/forum session at this year’s Semantic Technology Conference (SemTech08), I wanted to share a bit about the conference as a whole.

First, everyone seemed to walk away with a lot – regardless of their starting point. And the atmosphere provided for as much value from interaction in the hallway as from the sessions themselves. As (walking billboard for web2.0) Daniela Barbosa points out, there was a fourth-dimension of interaction going on behind (above/between…) the scenes (via Twitter and whatnot), also mentioned by Rachel Lovinger. I even heard that one attendee passed another some aspirin in the hallway based on a “tweet” about a headache.

The hidden gems

To capture some of the hidden gems of the week – the “PURLs of wisdom” so to speak (one of which was emphasis on the need for reliability and permanence of URIs – or persistent urls), I will, in the spirit of Eric Miller’s keynote, “reuse, repurpose an remix” or at least reference some of the writings of others about the week (but will most certainly fall short of MetaWeb Jamie Taylor’s gas powered blender metaphor). There were, after all, almost 150 sessions over the five days, and over 1000 attendees – so why not leverage some collective intelligence.

As others have noted (see links throughout), the week was quite a whirlwind – the only REST encountered likely being in references to enabling interoperability through RESTful architecture. From the experienced to the newbie alike, many had expectations of “SIOC (pronounced shock) and awe”, to riff off DERI’s Semantically Interlinked Online Communities project. (I had to use that, despite my understanding that our friends at Talis have intentions for that quip). But given the concurrent announcement(s) by Yahoo regarding semantic enablement of SearchMonkey, perhaps the experience to some was more like “SIOC the ‘Monkey”. And that may be just what the doctor ordered.

Much of the discussion in the semantic space has been about technology, standards, architecture – all necessary to solidify the resources upon which to build. And all consumable by those in the know. Mind you, this level discussion needs to continue – and as was stated numerous times during the week, all the pieces are “there” and they just need to be put together in ways for effective use – i.e. “just use what you need“, to quote the Freebase/Metaweb folks. And there’s not just one formula to do so; Carla Thompson noted Tom Tague (Thomson Reuters – Clearforest – Calais) referring to the subdomains of the space as Geekery Feifdoms (also described by Mark Johnson as “talking past each other”).

At the same time – while the technical level discussions were still present and engaging – there was a quite audible drumbeat this year, emphasizing the need simplify and to focus on real issues – in business terms – to take “this stuff” and put it to use to solve actual problems. At one point, Dave McComb of Semantic Arts (co-organizer of the conference) said, instead of the usual chicken-and-egg comparison (which I’ve used myself) – now we’re on a whole chicken farm. (By this, I assume Dave meant that it doesn’t really matter which comes first, we just need to focus now on producing eggs AND chickens – and running the farm).

Dave gave a great introduction (slides) to give some context and lay a landscape upon which everyone could layer their experiences of the week that was to follow – how we got where we are, what “is” semantics, comparing it to the relational model. Bruno Pinheiro describes his intro (as does Shamod Lacoul) along with that of W3C’s Ivan Herman, who gave a state-of-the-semantic-web intro as well. Some of his key advice came later, which Rachel Lovinger includes in her closing keynote summary. Particularly relevant to this post, she picks up on Jeff Pollock’s (Oracle) comment that “If you’re describing the value of something as being about semantic technology, you probably haven’t found the real business value yet” (see his presentation).

To put a sharper point on it, and to paint a picture of what this means from the standpoint of a business-side consumer, Tom Tague mentioned that one of his customers had said: “If you have to explain it, I don’t want it.” This underscores from the street-level that mainstream leveraging of these capabilities won’t be the result of promotion of the technologies but from the solving of problems for real people – which Nick Patience picks up in his first two bullet points.

Some are on the way

As Rachel also wrote about (linked above), Tom Ilube of Garlik is focused on how, in this online world, does one manage and protect their identity. By creating tools to enable their doing so and zeroing right in on a real problem for people, Garlik is bringing them onto the semantic web without revealing, nor needing to reveal, that fact. Leo Keller of Netbreeze showed tools for finding answers to questions which come from, but are not touted on the basis of, analyzing trends in unstructured text on the web. Tom Gruber’s talk emphasized that it is not “about” a particular application or technology, but is instead about the solution being woven into life via “the interface” (see Mark Johnson’s paragraph on Stealth Company). To me, this means tapping into the activities in which people are already engaged.

The bridge

The first step toward getting “there” is recognition of a divide (in this case, from technology to needs – solutions to problems). The past few years of this conference have been a major part of opening up and inviting business-needs-minded to immerse themselves in the possibilities. From the tone of the week, it seems this phase has begun. (I’ll write about industry verticals in a subsequent post). Now, the path from here involves reaching out from both the solution/tech side and the business side, with some assistance from the middle – to conceptualize the capabilities available and imagine them in the contexts of various business needs – and with consideration of the possible business models to support both delivery and consumption of the relevant solutions. I think Greg Boutin describes this all very well in his discussion of Powerset – a good read (in particular see his third section, entitled “Marketing semantics…”). He also places an accent on that drumbeat, quoting Tom Tague as saying “Clarify and focus on simple benefits”.

Tangent, or the other side

That would be a great place to wrap up, but at the risk of going off on a tangent, I feel the need to add one last point. I’d long ago come to see that the key value for and from semantics is in context and perspective. Seems pretty simple. But those are not just subject-focused matters. Within each individual (person, department, company…) there are multiple sets of motivation to be considered, and one of the dimensions of those motivations is time. I think Heidi Nordberg captures this when she writes of the need to differentiate between focusing on “long-term interoperability modeling goals” and short term focused addressing of “specific needs”. Perhaps there’s a way to address both together.

So we also need to go beyond targeting real problems, and and beyond simplifying the solution and message. The successful models will emerge from creating scenarios which enable the aligning of motivations – the sweet spot for opportunity.

Postscript: There was much talk at the conference of there being blue ocean, or uncontested market opportunities to be tapped by use of semantic capabilities (mind you, not for semantic capabilities themselves, but the use of them). Swim further off on this tangent and consider a purple ocean strategy that Henry Story shared over dinner with a group us the last evening – and may be applicable here.

Just as there were so many important and valuable perspectives shared at the conference, so are there scattered across the web. Apologies for not picking up on them all, but in addition to those linked above, here are some additional related posts:

In one of my side-conversations, we dug a bit into the concept of “traversing”, not just to travel across associations, but to applying patterns of associations to people and situations that exhibit subsets of those same patterns, to expose opportunities. To the business, this is cross-marketing, to the analyst, this is pattern recognition and application. One participant in the conversation voiced the sentiment that this may be a key gateway to leveraging semantics for revenue generation.

Speaking of running for the money – and in the spirit of traversing, my wife is doing a little of her own “connecting ideas for the creation of value”. She’s run a few marathons before, but by dedicating her upcoming Boston Marathon run to something that matters to her, (her story about what/why… starts half-way down her page) she’s threaded across otherwise disparate areas of interest. While not everyone who has contributed is a runner, she’s clearly (judging by the numbers) tapped threads of common interest in cancer research.

Ultimately, powerful leveraging of semantic capabilities will enable greater networking and cross-connecting, or traversing, to occur in ways that are more graceful (perhaps less personal, but hopefully not) than were used in the example above, but in any case, toward the end of connecting ideas and creating value.